Some Factors Influencing Agricultural Credit Use among Peasant Farmers in Ethiopia: A Case Study of Two Districts

Abstract

This study has used discriminant function analysis to identify the most important farm household characteristics that injuen" agricultural credit use at the farm level, and thus serve to distinguish cred'it users from non-users from a sample survey. The results have shown that the level of education, farm size, the use of improved technology, investment expenses, age of farm household head, product price security as well as marketing and extension service arrangements are the most important variables that can be used to differentiate borrowers from non-borrowers. The policy implication of this result is that if credit is to be productively used in the process of agricultural development. an integrated approach which takes into account these and other socio-economic variables is necessary